Don’t rush to pin the blame on Opec for oil price surge

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Saudi Arabia has at least 2.5m barrels per day of spare production capacity it can provide if the market requiresCredit:
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Opec will take all the blame for high oil prices if Donald Trump’s decision to reimpose sanctions on Iran backfires. The cartel and its main partner Russia control almost half the world’s supply of crude and make an easy target if they don’t open the spigots quickly. But surging global demand and a chronic lack of investment in new production are underpinning rising fuel costs at the pumps everywhere, not just in Tehran.

Iran’s overall importance in the oil market may also be overstated. Although the Islamic republic is now the third largest producer in Opec after Saudi Arabia and Iraq, it still only accounted for 4pc of global supply last year.